Cuadrilla discovers ‘sizeable quantity’ of UK shale gas as UK anti-fracking case is rejected

On January 12, 2018, exploration and production company Cuadrilla announced that it has recently discovered a “very sizeable quantity” of shale gas at its Bowland site in Lancashire (the Site).

Cuadrilla revealed it has drilled to a depth of 2.7km at the Site and to date has recovered 375 feet of core samples. When combined with data gathered from existing shale exploration wells, this has left the company optimistic as to its ability to “drill two horizontal wells…in gas rich zones”. This is complemented by the “excellent” rock quality in the vicinity. These properties are believed to make the site “very suitable to hydraulically fracture”.

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BLM to rescind 2015 fracking rule

Thursday, the Bureau of Land Management (“BLM”) announced that it will publish a final rule to rescind a 2015 regulation requiring companies to disclose the chemicals they use in hydraulic fracturing.

Decried by both the BLM and oil and gas trade associations as costly and duplicative of existing regulations, the repeal of this rule marks the final nail in the coffin for a legal battle that began over two years ago. Continue reading

PA federal judge strikes down municipal fracking ban

Late last month, a federal magistrate judge in Pennsylvania struck down a township’s ban on fracking activities. The ban, which prevented the injection of fracking waste into a well underlying the town, was preempted by state and federal law, said the judge.

The judge ruled that the ban was preempted by the federal Safe Drinking Water Act and Pennsylvania’s Act 13, which prevents municipalities from passing ordinances that regulate oil and gas activity except through limited channels, namely the state’s Municipalities Planning Code and Flood Plain Management Act. Continue reading

US 10th Circuit dismisses Obama-era fracking litigation

The US 10th Circuit on Thursday dismissed the challenge to an Obama-era fracking rule that imposed strict requirements on oil and gas operators on federal and tribal lands. The rule was blocked in 2015 and never took effect.

The three-judge panel dismissed the case in its entirety—including the lower court’s decision to block the rule—in light of the fact that the US Bureau of Land Management earlier this year asked the court to pause its review of the rule and recently proposed a measure to rescind the Obama-era regulations. These actions followed the change in US administrations.

Said the court, “Our proceeding to address whether the district court erred in invalidating the BLM’s fracking regulation when the BLM has now commenced rescinding the same regulation appears to be a very wasteful use of limited judicial resources.”

The Obama-era requirements, which concern well casing, wastewater storage, and disclosure of chemicals used in fracking, have been the subject of dispute between industry and environmental and citizen groups since they were enacted in March 2015.

That dispute continues now as parties must determine whether the 10th Circuit’s dismissal of the district court’s decision to block the rule means the regulations proceed toward effect while BLM continues the rulemaking process aimed at rescinding the regulations, or whether the rule has effectively met its end.

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Delaware River Basin Commission to consider fracking ban

On Wednesday, the Delaware River Basin Commission voted to begin the rule making process that could lead to a fracking ban in parts of New York, New Jersey, Pennsylvania, and Delaware. The Commission, which regulates the Delaware River watershed and is comprised of members from each of the above states and a representative from the U.S. Army Corps of Engineers, now has until November 30 to draft its proposal.

The Delaware River watershed encompasses parts of New York, New Jersey, Pennsylvania, and Delaware and provides drinking water to millions of people in the four states. It also encompasses territory rich in oil and gas, particularly in Northeast Pennsylvania. The proximity of the two interests—drinking water and oil and gas—has produced longstanding debate over the region’s use.

On Wednesday, New York, Pennsylvania, and Delaware voted to begin the rule making process. New Jersey abstained, and the U.S. Army Corps of Engineers voted against the process. The 3-1-1 result is enough for consideration of a ban, and Commission staff will set to work on a proposal, which ultimately will be subject to public comment and hearings.

Industry decried the Commission’s decision, and has long questioned the Commission’s authority to regulate the region’s oil and gas. Litigation pending in the federal Third Circuit could address the Commission’s powers concerning resource development. In the meantime, industry considers the proposal unnecessarily duplicative of federal and state efforts already making the area safe for development.

The region has been under a fracking moratorium since 2010, when the Commission began exploring fracking’s impacts on the area. Any ban is unlikely to take effect until 2018.

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INEOS granted second UK exploratory drilling permit

On 18 July 2017, INEOS was granted an environmental permit to drill an exploratory borehole to take core shale samples at a site near Common Road, Harthill, South Yorkshire. It was the second permit granted by the Environment Agency (EA) to INEOS in less than three weeks after a similar ‘standard rules’ permit was approved on 29 June 2017 for another site near Bramleymoor Lane, Marsh Lane, North Derbyshire.

Despite the protests of environmental campaigners, the EA was keen to stress that the permit only consents for INEOS to carry out drilling and waste management at the site as a means of taking rock samples but “it does not allow fracking.”

INEOS was not required to carry out an environmental impact assessment for either site as part of the previous planning permission process. However, the EA made it clear that standard rules permits are only issued to companies that demonstrate they understand and can manage risks to people and the environment.

These permits were issued in the context of Cuadrilla’s ongoing legal battle to resume hydraulic fracturing at its Preston New Road site in Lancashire and are being regarded by the shale industry as a key stepping stone for fracking taking place in England again for the first time since 2011.

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US BLM plans to rescind Obama-era fracking rule

The US Bureau of Land Management on Tuesday issued a proposed rule that would rescind Obama-era fracking regulations. The regulations, which were promulgated in 2015 and related to hydraulic fracturing on federal and tribal lands, had never taken effect.

In March 2015, the BLM, then under the Obama administration, issued a final rule that imposed limits and reporting requirements on operators fracking federal and tribal lands. The regulations, which focused on well casing, wastewater storage, and disclosure of chemicals used in fracking operations, were widely decried by industry.

The rule was blocked in late 2015, before it could take effect, and in June of last year a federal district court judge overturned the rule, stating the BLM exceeded its authority in issuing the rule in light of the fact that Congress never directed the agency to regulate fracking. The BLM appealed, but the recent change in administrations led the BLM to ask for more time to reconsider the rule.

On Tuesday, the BLM’s review was complete, and it proposed rescinding the rule. It found the rule “unnecessarily duplicative” of state and tribal regulations. It also found that the rule imposed burdensome requirements and unjustified costs on industry.

The BLM is requesting comments on the planned rescission, which comments are due by September 25.

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More production cuts possible in Europe’s Groningen gas field due to earthquakes

Authorities in the Netherlands have proposed more production cuts in the Groningen gas field, Europe’s largest, in response to earthquake concerns. The cuts would limit production by another 10%, in addition to cuts that have already taken effect, with intent to further reduce the number of earthquakes occurring in the country’s north.

For decades, the Groningen has been a key industry asset, successfully developed by major players in the oil and gas space. However, in the early nineties, the region—one with no previous history of earthquakes—began experiencing seismic activity. The number of earthquakes grew until 2013, and the Dutch government intervened in early 2014 to reduce the number of earthquakes through production limits. Since the intervention, the number of earthquakes occurring per annum has declined, and Groningen’s gas production has been reduced by more than half.

The majority of earthquakes in the Groningen register low magnitudes, between 1.5 and 2 on the Richter scale. Occasionally, a more noticeable (though still low-magnitude) earthquake surfaces, like the magnitude 3.6 earthquake felt in 2012. The structures in the region were not designed to withstand even such low magnitude earthquakes, leading to damage.

More than 80,000 damage claims have been filed by local residents, and industry and the government have established funds aimed at compensating residents, strengthening structures, and stimulating the economy.

Regarding the latest proposed cuts, industry warns that continued changes to production limits could threaten the profitability of the project.

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Texas task force notes benefits of fracking, calls for more data

The Task Force on Environmental and Community Impacts of Shale Development in Texas on Monday released a 204-page report analyzing fracking’s impacts on the state. The Task Force, a group sponsored by The Academy of Medicine, Engineering and Science of Texas and comprised of individuals from varied backgrounds in the energy and environmental community, lauded the economic benefits of fracking but also called for better oversight of its effects.

The report first notes the revolution that was the shale boom—that is, the proliferation of horizontal drilling and multi-stage hydraulic fracturing in the oil and gas industry—and the significant economic and other benefits the revolution has had for Texas, the United States, and other parts of the world. In particular, the revolution has opened access to vast new supplies of natural gas that in many areas are changing the way we generate power.

The report goes on to identify six areas of impact the Task Force studied regarding fracking’s potentially negative effects and to analyze each area in turn. The six areas are:

  1. Geology and Earthquake Activity
  2. Land Resources
  3. Air Quality
  4. Water Quantity and Quality
  5. Transportation, and
  6. Economic and Social Impacts.

Across these areas, a common theme emerged—the need for more and better data and “easier and wider access” to that data. Texas is a large geographic area and accordingly complex. There is no doubt, per the Task Force, that fracking affects the earth, the resources, and the lives around it. But in such a complex environment, the need for more comprehensive data to study the nature of fracking’s impacts and to eliminate extraneous impacts is paramount.

Of specific note, the Task Force found that in light of the depth separation between oil-bearing and drinking water zones in Texas, “[d]irect migration of contaminants from targeted injection zones is highly unlikely to lead to contamination of potential drinking water aquifers.” Instead, surface spills or leaks pose the dominant fracking-related risk to water resources.

The report, while extensive, does not close the book on fracking research. As the Task Force noted, “This study aims to help all Texans better understand what is and is not known about the impacts of shale oil and gas development in Texas, and offer recommendations for future research priorities.”

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